Experts Split on New 54.5MPG Rule

Experts disagreed last week on the long-term outcome of the government's recent 54.5mpg rule, with consumer advocates hailing the new mandate, and engineering consultants warning that it would send costs skyrocketing.

"Not only will consumers, currently being killed by high gas prices that will continue to rise, benefit financially, but this standard will dramatically reduce our dependence on foreign oil," Jack Gillis, director of public affairs for the Consumer Federation of America, wrote in an email to Design News. "That alone is something our surveys show consumers care deeply about, and it will have very positive political ramifications in the US."

The Center for Automotive Research (CAR) contends that as fuel efficiency rises to very high levels, the benefit to the customer shrinks. At $5 per gallon, for example, a 15,000-mile-a-year driver can save $3,750 on gasoline annually by jumping from 10mpg to 20mpg. But by going from 40mpg to 50mpg, the savings drop to only $375 annually, the curve shows. As consumers reach those limits, CAR says they are likely to keep their current vehicles longer, a phenomenon it refers to as the "Cuban-ization" of the American auto market. (Source: Center for Automotive Research)

Gillis's position was echoed by numerous other consumer advocates, as well as by Design News readers, many of whom contended that even if the new rule is eventually abandoned, it will still push automakers to find new ways of squeezing more miles out of their vehicles. "I fully expect that this is too ambitious a goal and the government will eventually have to backpedal," reader Scott Orlosky wrote on our Website, "but we will ultimately end up with cars that make more efficient use of a gallon of gasoline."

Automotive engineering consultants were not enamored with the new rule, however. Two who talked to Design News argued that the mandate would add far more cost to each vehicle than the often-quoted government figure of $2,800. The Center for Automotive Research (CAR) cited its study showing that the 54.5mpg technology could add as much as $11,000 per vehicle. Scenaria Inc., a consulting firm specializing in the study of technology investment decisions, contended that the figure would minimally reach $5,000 per vehicle, and might hit more than $8,000 on many models.

Sandy Stojkovski, president of Scenaria, told Design News that the government's $2,800 figure is an erroneous interpretation of its own numbers because it includes only 2017 to 2025 increases, and leaves off an additional $2,000-per-vehicle that automakers will have to lay out between now and 2016, when the 35.5mpg ruling kicks in. "When you add it up, you're already at $2,000 to begin with," she said. "Then, even by the government's own estimate, you're going to add $2,800 to that. And that's still less than it will actually come out to."

WE don't have a choice about buying airbags, which still occasionally kill people, which puts them in the same class as chainsaws and rotary lawnmowers, it appears. But we must pay for them, since it is mandated, which was because otherwise they would not sell.

The 54.5 MPG car is just like the low-flush-volume toilet, a mandate created by emotions and wishful thinking, rather than by common sense and rational thinking. A much better approach would be to cut the sales taxes on the model that got the best of all mileage, with the selection being reviewed quarterly. That could help the good mileage cars sell better. Consider the possibility that perhaps most folks simply do not wish to own or drive a vehicle that gives up so much to cut fuel consumption. Is Big Brother going to mandate what cars we buy next? It could easily happen that the auto companies could build them but the customers don't want them. Then what? Does anybody have a rational answer for what happens then?

OF course the very first thing should be that senators and congress people should only be allowed to own and drive cars that get at least 54.5 MPG. That law should be put into effect a few years prior to forcing it on everybody else.

I too had to smile. Spoken like a true public (government) school graduate. Henry Ford paid employees above the prevailing wage rate. He had two things in mind doing so. First, his employees would be able to buy his products, but more importantly he was able to outbid his competitors for the most talented help. The Edsel was a gas guzzler with a high profit margin. Yet it was a financial failure to Ford due to sales volume.

The "Progressive Movement" started in about 1890. Yet the period prior to that saw the greatest gain in the standard of living in human history. The Sherman Antitrust was used against Standard Oil by accusing Rockefeller of "monopolistic pricing". His "crime" was causing the price of kerosene to drop from 60 cents per gallon to 6 cents. He did this by inventing and investing in more productive methods to produce kerosene. His competitors lost money, thus leaned on government to make him raise prices to keep the competitors in business. I could go on for pages about separating myth history from reality history.

By definition monopolies are government inventions, used to prohibit competition. New York cab license "medallions" that sell these days for over 100 thousand dollars stop any competitors. Wonder why cab fare is so high in NYC?

My beef with mandated safety equipment has nothing to do with my using them, but rather that I am forced to buy them. If my airbag deploys it is against the law to drive my car. Who does my car belong to?

And by the way, our safe appliances come by way of Underwriters Labs which predated government hamfisted standards. Thankfully standards in fasteners were established by the SAE. The group that cant deliver the mail or get Amtrack to run on time or at a profit now takes care of food and drugs. That thought alone is enough to make me ill.

Lastly I have searched high and low for the law that says driving is a "privilege". Roads are not a new invention and predate government. One would think that this privilege might have been noted by the founders. Instead I find the opposite, that free travel is a right. Licenses to drive of course are issued by the state so I would be willing to say that licenses are a privilege, but licenses are also permission granted by the state. Only slaves need permission.

However in this blog, each of us is free to choose what we believe is truth and I can't convince anyone that stateism is a religion that I can't swallow. As a result we will have to agree to disagree and I will make no attempt to convert anyone.

I agree, Beth. Diesel is definitely an underplayed option in the U.S. There are reasons for that -- the precision injection systems are costly and the fuel is harder to make because there are only so many long-chain hydrocarbons in a barrel of crude. Also, the rule of thumb among automakers is that a base diesel engine costs about twice as much to make as a base gasoline engine. But it would be nice to see the auto industry move toward diesels, rather than pure, battery-electric cars, which appear to be niche vehicles for now. I believe Europe has been able to make it happen with a strong political push in the form of tax incentives (maybe one of our readers knows more about this). I definitely agree with your husband: Diesels make great engines.

At one time I had a 1957 VW van, with an 1100 cc engine and 32 hp. With the big flat front, THAT was really slow. Compared to that, the diesel 1600 cc Rabbit was pretty nice.

But that also brings up a whole different aspect, which is that US drivers are going to have to learn how to drive more patiently. Back then gasoline was twenty-five cents a gallon, and I still drove carefully, in order to save money. When gasoline gets to $10/gallon, like it could in less than half a decade, we will see people driving a lot slower. Things are definitely going to change. We don't really have to guess. It is pretty much a sure thing.

82 diesel Rabbit was one of the 'safest and most comfortable cars on the road"?

I mean...really? What else have you driven?

Looked nice - compared to what? a cardboard box?

great carrying capacity - again, compared to what? MAYBE 600lb max if all flat roads, and MAYBE 60 mph top speed. I could put a damned rabbit on top of my GMC van and still have room to seat the kids and a dog.

easy to park - o.k. I'll give you that one

it was weak, Yeah, weak as in slower than a 125 moped. :-)

But, all kidding aside - yeah, you're right. Turbo/Deisel is the wave of the future. Just makes more sense from a pure engineering standpoint.

I have to smile. If we were truly living under a free market system, we would be clawing with each other to work 80 hours a week, for slave wages, under dangerous and degrading working conditions for any of a few monopolies, without health care, while our children started smoking at age 4 and a third of our population was addicted to heroin, and 2/3 alcoholic. 'Free markets" work when they are used to optimize a result once constraints, legislatively or otherwise, have been defined for the ultimate outcome that is generally considered to be beneficial to society. Feel free to argue about the constraints, but relying on enlightened self interest to automatically drive the "free market" in a way that benefits society has proven exceedingly unreliable.

Legislative constraints for performance, standardization, or safety are not the same as central planning. In an economy based on central planning the allocation of resources is determined by a comprehensive plan of production which specifies output quantities. We could go back to the good old days when Ford was making cost/benefit decisions about fixing flaws in the Pinto. "How many people do we have to incinerate before it will cost us more than the fix." I for one believe that my insurance rates are lower because of the crash worthiness, seat belts, and air bags legislated into our vehicles, and the statistics indicate these features are saving lives and reducing injuries. But then I have a preference for safe and effective drugs too, and household appliances that don't catch fire or electrocute me. If seatbelts and airbags are offensive to you, they can be cut out or disabled, but don't tell your insurance company, the break you're getting on your insurance for having (and using) them, almost certainly pays for the cost of their installation over the life of the car. You don't have to belt in your children either. Risk the fine. Drive drunk, uninsured. Teach them about individual freedom. Remember, what doesn't kill them makes them stronger. Driving is a privilege granted by the state, with the understanding that you will be operating and owning a vehicle while meeting certain safety and legislative standards. In general we all benefit from those constraints. If you disagree with the constraints circulate a petition to change the laws, but remember that driving is not a right.

The high unemployment, etc., was all caused by lack of government regulation, not too much. US auto makers consistently make large and low mpg vehicles because they have the highest profit margins, not because they are the most popular. Three times now we have had gasoline crisis where US car makers have needed bailing out because foreign car makers consistently get much better mpg. It is clear US auto makers simply are incompetent. It does not take a crystal ball to tell us all that gasoline prices are going to always be volatile and always heading upwards. But again US auto makers are producing cars we know will not be possible to sell during the next gasoline spike. The only cars US makes will be able to sell are actually rebadged imports, which hurt our trade imbalance.

But I will agree that many regulations, such as airbags and catalytic converters, are poorly conceived, and need more study and input.

Sorry, I have to plead ignorance on the Corvair. I just know it by reputation. It was a bit before my time.

Same thing can probably be said of the Pinto. It was not a stellar mpg car, but it did push the mark for Ford. It likewise got a (slightly) undeserved bad rep. Ford could have moved that fuel tank if they needed to. But the ambulance chasers were already on them and Americans back then still thought that every charlitan that said they were looking out for them really was.

I see where you are coming from and agree that electric could assist during a start from a stop or near stop. Torque is only half of the equation.

In this country we haul heavy at highway speeds. If I have a truck that has to downshift on slight grades where others have not, I will get rid of the truck. Your idea definately has merit in applications like a dedicated city delivery truck or bus (like they have now), but open road still requires loads of horses (so I can haul my horses).

Heavy machinery is another area that may be worth looking into. Low speeds, lots of torque required... If I can get 12 hrs of operation out of my fuel tank that usually gives me 8 hrs then it is a win for me. However, power is an even more important metric here. But I beleive that series hybrid is on the cusp of being efficient enough for this app; parallel doesn't seem to make sense to me in this context.

I must first apologize to all whom I may offend by my response. That said, it is my firm belief that the best solution is to allow people the freedom to choose what they want to purchase without gunverment intervention. This also means to allow engineers and manufacturers to build anything they choose to build without gunverment intervention. The horror you say? Look around at the high unemployment, rapidly rising food costs, and generally collapsing economy and then tell me that central planning is working! The US had a long history of non-gunvermental intervention, but the Progressives decided they could 'fix' the problem by passing laws and appointing experts to control manufacturers and the public who were too stupid to control their lives, but were genius level once inside the voting booth.

If people want high mileage cars they should have the freedom to buy them, but the same applies to gas hogs. If they do not wish to purchase airbags, seatbelts, third tail lights, or V2V systems, why must they be forced?

If central planning by experts did indeed work, Russia, Cuba, and related nations should be sterling economic models and the chaos of the former American free market should have resulted in third world status. Instead we see the opposite, yet many leaders and experts continue to press for central planning. The new mileage requirements and steeply rising costs of transportation should be evident. Yet more amazing to me is that so many engineers seem to be falling into this thinking, or at least I assume everyone responding in this blog is an engineer.

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